My son is a junior in college, and I pay his tuition. Can I take the American Opportunity Credit when I file my 2013 taxes?
Yes, as long as you meet the income requirements and your son was enrolled at least half-time for one academic period during the year in a program leading to a degree, certificate or other recognized educational credential. To qualify for the American Opportunity Credit, your adjusted gross income for 2013 must have been less than $180,000 if you’re married filing jointly or less than $90,000 if you’re single or filing as head of household, and you must claim your son as a dependent on your tax return.
The credit was scheduled to expire at the end of 2012, but Congress extended it through 2017. It is worth up to $2,500 per student for each of the first four years of college. It is calculated as 100% of the first $2,000 you pay for eligible expenses, plus 25% of the next $2,000 of eligible expenses. Eligible expenses include tuition, fees and books (room and board doesn’t count). It’s a credit, rather than a deduction, which means that it lowers your tax bill dollar- for- dollar. You can claim the credit by filing IRS Form 8863 with your Form 1040. For more information, see the Instructions for Form 8863.
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Students who go to school less than half-time or are in graduate school may qualify for the Lifetime Learning Credit, worth up to $2,000 per return if you spend $10,000 or more in eligible expenses for the year. (You can’t claim the Lifetime Learning Credit for the same student in the same year you claim the American Opportunity Credit.) See IRS Publication 970, Tax Benefits for Education, for details.
Because your son is now a junior, you may have qualified for the American Opportunity Credit for his first two years of college, too. If you missed out on the credit in those years, you can file amended returns and get the money back. For more information about amended returns, see the Instructions for Form 1040X.
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